Virgin Money have just announced they are reducing rates on selected products on Thursday 14th December. Brokers said the cuts were “significant” and a “real statement of intent”.
On the purchase front, 85% & 90% loan-to-value 2- and 5-year fixed rates with a £1,295 fee will be reduced by up to 0.10%, starting from 4.58%. Meanwhile, 85% and 90% LTV 2- and 5-year fixed rate fee-savers will be reduced by up to 0.12%, starting from 4.74%.
For remortgage exclusives, the 60% loan-to-value (LTV) 2-year fixed-rate product with a 1% fee has been reduced by 0.20% to 4.59%. Similarly, the 70% LTV 2-year fixed-rate product with a 1% fee now stands at 4.69% following a 0.20% reduction.
In the BTL exclusives category, the 2 & 5-year fixed rates with a £2,195 fee now start from 4.59% after a 0.05% cut. The 5-year fixed rates with a 1% fee have seen reductions of up to 0.32%, starting from 4.74%. Additionally, the 2-year fixed rates with a 3% fee have been lowered by 0.15% to start at 4.52%, and the 5-year fixed rates with a 3% fee are down by up to 0.22%, now starting from 4.44%.
Further, selected purchase and remortgage core fixed rates at Virgin Money have been reduced by up to 0.36%, with rates starting from 4.54%. Residential and BTL product transfer fixed rates also see reductions of up to 0.30%, now starting at 4.66%.
Brokers welcomed the news. According to Charles Breen, director at Wellingborough-based broker, Montgomery Financial: “It’s beginning to look a lot like Christmas with these new rates. Either that or Virgin had their Christmas party last night and whoever is in charge of rates is still intoxicated. If this continues on into the new year and beyond, it’s only good news for anyone who is a homeowner or looking to buy in the coming months.”
Michelle Lawson, director at Fareham-based broker, Lawson Financial, was also upbeat: “More great news on rate reductions, this time from Virgin Money helping the year to end on a positive note. Given the poor GDP data for October published today, I think this trend will continue into 2024 as lenders vie for business in a market that is still lacking confidence due to economic challenges.”
Justin Moy, managing director at Chelmsford-based broker, EHF Mortgages, added: “These are significant rate cuts from Virgin Money and will make the rest of the high street lenders wake up from their Christmas snooze. With rates firmly in the 4% range, what’s not to like? This may be due to improving Swap rates and the underwhelming GDP data, but Virgin have made a real statement of intent today, for the benefit of their borrowers and the wider market.”
Tom McNulty, director at Gloucester Mortgage Centre, also welcomed the news: “This is great news for consumers as Christmas approaches. Lenders’ continued confidence in the market means the interest rate war is in full flow as mortgage providers battle for your business. 2024 is shaping up to be a far busier year for the property market than 2023.”
Katy Eatenton, mortgage and protection specialist at Lifetime Wealth Management, said lenders were competing to get the last bits of business in before the year is out: “Not long after HSBC announced rate reductions, Virgin has responded and really put the cat among the pigeons. There is definitely a race to the top of the mortgage tables this side of Christmas to get the last bits of business in before 2024.”
But Rohit Kohli, operations director at Romsey-based The Mortgage Stop, was sceptical: “With HSBC’s announcement earlier on Wednesday and the attractive rates offered by Virgin, it certainly feels like an early Christmas gift for borrowers. However, I can’t help but be a bit sceptical about the timing of these new, low rates, especially as the market begins to slow down for the holiday season. Are these rates simply a temporary promotion? Let’s hope that lenders haven’t been caught up in the festive spirit and, in the new year, experience a hangover and start increasing rates again.”
Stephen Perkins, managing director at Norwich-based Yellow Brick Mortgages, said: “Though these rate cuts aren’t the Christmas turkey, they’re definitely some tasty trimmings as we head into 2024. They won’t secure much extra market share for Virgin but are welcome all the same.”
Matthew Jackson, director at Salisbury-based broker, Mint FS, concluded: “It would seem that we are finishing the year with a flourish of reductions from lenders, which is nothing but positive news for buyers, remortgagers and brokers as we head into 2024. Despite the poor GDP figures published today, lenders continue to compete for business as they look to secure transactions to help them achieve their 2023 lending forecasts. In a year that has seen more negative trends than positive ones in the mortgage market, hopefully this is a sign of an improving market as we enter 2024.”